For many individuals, starting over after bankruptcy can almost always be thought of as a daunting task if you do not have the proper support system available to you. A fresh start after bankruptcy can often be compared to “wiping the slate clean” because it gives the individual a chance to start anew. If you or someone you know has been asking the question, “is bankruptcy really a fresh start?“, then you are in the right place and this blog is perfect for you. In reading further, we will discuss bankruptcy as a whole and how much of a fresh start bankruptcy can be. Consider this a “how-to guide” for just about everything you need to know about bankruptcy. With that being said, there are some conditions that you need to be aware of.
Types of Bankruptcy
Before we go any further, it is important to note and review the different types of bankruptcy: Chapter 7, Chapter 11 , and Chapter 13. One of the most common types of bankruptcy is Chapter 7 and it is considered a personal type of bankruptcy – allowing individuals to liquidate unsecured debts while retaining most assets such as real estate, cars, bank accounts, and retirement funds. On the contrary, Chapter 11 bankruptcy is predominantly for corporations and allows them the ability to reorganize their finances to ensure their business can stay in operation. Finally, Chapter 13 bankruptcy allows you to make payments on your debts such as taxes, car loans, and mortgages until it has been satisfied and can be discharged. Starting over after bankruptcy might seem intimidating but with my assistance, the fresh start after bankruptcy that you have been yearning for is right around the corner.
As a trusted and experienced bankruptcy attorney, I am here to help you ultimately decide which type of bankruptcy suits you and your situation. If you choose to file for Chapter 7 bankruptcy, I will ensure that all credit card debts and “unsecured” debts are eliminated, and that you are given a second chance at a fresh start after bankruptcy. If you choose to file Chapter 13 bankruptcy, I will be responsible for negotiating a suitable repayment plan that will work for all parties involved. Although filing for bankruptcy offers you a fresh start and is tempting, it is important to note that achieving a totally clean slate can take a little bit longer with Chapter 13 bankruptcy. A Chapter 13 bankruptcy can be a powerful tool that may compel creditors to accept payments over 3 – 5 years. In certain cases, “junior” creditors such as second mortgages can be completely erased.
Rebuilding Your Credit
The simple fact of the matter is that bankruptcy can put a damper on your credit score in more ways than one, but don’t let that get you down. When looking for a fresh start after bankruptcy you might be asking yourself, “how long does it take to rebuild your credit?”, and what I can tell you is that bankruptcy does not mean 7 to 10 years of bad credit. On average, it takes an individual recovering from bankruptcy a few years before you begin to regain a stronger and more noteworthy credit score. There may be some instances where credit card companies begin to offer you new credit cards soon after filing for bankruptcy, but they will have high-interest rates. As I stated previously, I want to further highlight how much of a fresh start bankruptcy can be. If you have future dreams of owning a home it is important to note you can typically qualify for a mortgage within two years of filing. In a previous blog entitled,“5 Tools to Help Rebuild Your Credit” , I discuss some of the most valuable ways to help you reestablish your credit score so that you can enjoy your life to the fullest again without the worry of bankruptcy hanging over your head.
Debts Discharged In Bankruptcy
A few examples of incurred debts that are likely to be discharged after filing for bankruptcy can include credit card debts, medical bills, or personal loans. While the vast majority of debts eventually do get discharged after filing for bankruptcy it is worth noting that there are a few exclusions due to public policy. Some of the most common types of nondischargeable debt include, but are not limited to, child support or alimony; most federal, state, and local taxes; and some, but not all, student loans. Starting over after bankruptcy does not have to be a daunting task and with my help, a brighter future is waiting for you.
A Fresh Start After Bankruptcy
In the simplest terms, bankruptcy is an injunction that makes debt uncollectible. What this means is incurred debt is erased and all activity on the debt must cease to continue from the day you file bankruptcy. There are circumstances where creditors may look to collect the accumulated debt from another source. In these instances, they may contact a co-signer if they also have not filed for bankruptcy.
More than anything it is crucial that individuals formulate a well thought.out plan because a fresh start after bankruptcy is not an overnight fix. A lot of time and effort goes into making sure documents are accurately filled out and filed.
With that being said, as a Burlington bankruptcy lawyer with over 39 years of industry experience and expertise, I am one phone call away from assisting you during the bankruptcy process and helping you every step of the way to ensure a smooth transition to a debt-free life. Achieving a fresh start after bankruptcy is possible and it starts here! Contact my office today to schedule a consultation.